The Following Is Allison Corporation's Contribution Format Income Statement for December

question 102

Essay

The following is Allison Corporation's contribution format income statement for December 2013:
$\begin{array}{|l|r|}\hline \text { Sales } & \$ 800,000 \\\hline \text { Less: Variable expenses } & 300,000 \\\hline \text { Contribution margin } & 500,000 \\\hline \text { Less: Fixed expenses } & \$ 400,000 \\\hline \text { Before-tax profits } & \$ 100,000 \\\hline\end{array}$
The company had no beginning or ending inventories.The company produced and sold 10,000 units in December 2013.
Required:
Assuming no change in either the cost structure or the average selling price,prepare a contribution format income statement for a January,2014 assuming production and sales of 7,500 units for Allison Corporation.

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Definitions:

Scatterplot

A scatterplot is a type of graph used in statistics to display values for two variables for a set of data, showing how much one variable is affected by another.

R Squared

A quantitative metric indicating how much of the change in a dependent variable can be explained by independent variables in a regression framework.

Regression

A statistical method used to study the relationship between a dependent variable and one or more independent variables, assessing patterns of influence.

Kilowatt-Hours

A measurement of energy that equals the consumption of 1000 watts over the duration of one hour.